"Although the Model Y L is priced a bit higher, it offers more space and more flexible rear seating, making it ideal for families with children," a Tesla sales representative at a Beijing store told customers on September 3, the day after initial deliveries began. The representative was promoting the newly launched six-seater SUV while adding, "The Model Y L is selling incredibly well. Since its launch on August 19, we've received 120,000 orders—that's nearly 10,000 per day. The first batch of customers started taking delivery in the past couple of days."

Industry experts widely believe that the Model Y L represents a critical move for Tesla as it faces clear sales challenges in China. Statistics show that in the first half of 2025, Tesla sold 263,400 vehicles in the Chinese market, a year-on-year decrease of approximately 5.4% from 278,300 units during the same period last year. Its market share has shrunk from a peak of 15% in 2020 to 7.6%. The latest data from the China Passenger Car Association (CPCA) indicates that Tesla's wholesale sales in China for August are estimated at 83,192 units, a month-on-month increase of over 20%.

Price Adjustments Across the Lineup

Amid the Model Y L's instant sales success, Tesla is also simultaneously adjusting the pricing structure of the Model 3.

On September 1, Tesla China reduced the price of the 830 km range Model 3 to ¥259,500 (approximately $35,600), down from the previous ¥269,500—a cut made just 20 days after the variant's launch. "The ¥10,000 (approx. $1,370) price reduction is primarily to create a clearer price gap between the Long Range Rear-Wheel Drive version and the Long Range All-Wheel Drive version, which is priced at ¥285,500 (approx. $39,200). We also considered that the first batch of order holders haven't started receiving deliveries yet, so this price adjustment won't affect their related benefits," the salesperson explained.

According to the representative, Tesla's current purchase incentives, aside from trade-in subsidies, include an ¥8,000 (approx. $1,100) discount on paint options when ordering via an owner's referral link, a 5-year interest-free and fee-free loan option, and a charging benefits package available for ¥1,299 (approx. $180). These offers are set to expire on September 30.

Strategic Importance in a Competitive Market

"The hot sales of the Model Y L at the retail level indicate strong market demand for large six-seater SUVs. Simultaneously, facing intense competition from local brands in China, Tesla desperately needs a new growth driver," an industry insider noted. They added that while Tesla previously led in both sales and profits due to its low-cost supply chain advantage, local brands have quickly adapted to the fierce market competition, catching up and even surpassing Tesla in terms of features, user experience, and price. "Ongoing pressure in overseas markets is also one reason Tesla is doubling down on its efforts in China."

The European Automobile Manufacturers' Association (ACEA) reported that Tesla experienced a 'black July' in the EU, with sales plunging over 40% year-on-year, marking the seventh consecutive month of decline. Latest figures show that while pure electric vehicle sales in the EU market rose 39% year-on-year in July, Tesla sold only 6,600 units, significantly fewer than the 11,465 units sold in the same month last year.

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